In spite of the painful correction technology stocks have suffered since the New Year, the technology boom is not going away. What we have seen so far is just the tip of the iceberg. Like every major technology change before, from printing to railroads to mass production, the early visible wealth is being captured by the technology firms themselves. But for every dollar of wealth created in the technology sector, there will be nine dollars created by the technology sector. The real benefits of technology accrue not to the tech companies or their owners, but to ordinary companies selling ordinary products and services, their employees, and their customers by improving the quality and lowering the costs of their products. But there is a price to pay. Technology revolutions make old ways of doing business obsolete. Like the dinosaurs, people who can't, or won't adapt to change become obsolete too.

The headlines are about the dot.com companies, their valuations, and their billionaire founders. Technology companies have taken over the commercials on our televisions. They have taken over the stock market -- except for technology companies, the market was down last year. They have taken over real estate prices in Seattle, Boston and San Francisco. They have even taken over our language, with words like B2B, portal, download, and email.

Some aspects of this boom are reminiscent of Tulipmania, the Silver rush, the Florida real estate bubble, and other speculative episodwa of the past. These bubbles take place when people -- I almost referred to them as investors -- after seeing a group of other people make a lot of money in a short time, convince themselves the train is about to leave the station without them. They then bid the prices of whatever is in vogue up to ridiculous levels that are completely detached from the intrinsic, or underlying, value of the asset. The funniest part of this bubble behavior, as Mark Twain wrote about in Roughing It, is that everyone is drawn into it (even guys like me who write about this stuff and are supposed to know better). Nothing is sadder, or funnier, than the long faces of the speculators after the bubble pops, as it always does.

But the technology revolution is more than a passing bubble. It will have permanent macro and micro effects. The macro effects are higher growth, more productivity, lower inflation and lower interest rates, as I wrote in this column on TK. The Internet is basically a tempo-suction device that takes the time out of doing business. It makes everything go faster. By definition, this has to raise growth rates. GDP and other measures of economic activity are measured in dollars of business per unit of time. The Internet, by reducing the amount of time it takes to do a dollar of business, allows more dollars of business to take place per hour, day, week, month or year. We measure this as increased productivity and higher growth. For this same reason it lowers costs and prices, which are essentially measures of low much time a person must work to purchase a good or service. So the Internet also reduces inflation.

The micro story is less obvious but will have bigger, more permanent effects on our lives. Part of the micro effect is visible. Some tech companies, like Microsoft, Intel, Amazon and a host of others, will be winners and their owners and managers will have the opportunity to get rich.

The larger part of the micro story is not so obvious. Technology is forcing massive and irreversible changes in the way we all do business. Like every other technology advance in history, a few successful technology providers will make the initial profits, but the lion's share of benefits will accrue to their customers. Every other technology change worked this way, including agriculture, printing, railways, automobiles, air travel, electricity, telephones and personal computers. It will work this way with the Internet too.

This will be bad for some companies. In the Internet economy, information is free, time delays are zero, and geography is irrelevant. So any business that profits from the ignorance, or the slowness or remoteness of others is potentially in serious trouble.

This puts distribution companies squarely in the crosshairs of the Internet. More than half the operating assets in the US economy are in distribution, not in manufacturing. This includes the rows of shiny cars at the car dealer, the piles of sweaters or cans of soup at the retail store, and the boxes of books at the warehouse. In a world of free, complete and instant information these are all, or nearly all, non-earning assets. The tech revolution will do to car lots and retail stores what JIT did to inventories in the 1980's - wipe them out. Customers will get better selection, fresher goods, quicker deliveries and lower prices the more layers of middlemen that technology can remove from the supply chain. In the limit, with customers buying direct from producers, the only finished goods inventory required is the box in the back of the FedEx truck (which you have already paid for) on its way to your house. All the rest can go.

But as investors found out this Xmas season, someone still has to deliver the stuff to your house after you click the order now button on the website. Fulfillment, execution, quality, trust and service are even more important with clicks than with bricks because in the Internet economy these intangible benefits are the only points of contact between the customer and the vendor.

This need for high-quality fulfillment will create lots of opportunities for ordinary companies if their owners and managers are flexible enough and fast enough to adapt. Especially for small, flexible companies, where technology levels the advantages of size. Here are some examples of companies we own where we have used technology.

One of our companies has historically used a direct sales force to sell our premium branded fitness products. That way each customer got direct attention. With fewer than 20 sales people and more than 20,000 prospects, however, we could only reach a small fraction of the people who might like to buy our product. In December, we opened a web site that allowed customers to order our product with a few clicks. The sales force can now concentrate on customers requiring personal service. Consumers can buy directly from the web site. In the first two months of e-commerce we have sold nearly a million dollars of products to new customers.

Another company we own is the largest wholesaler of contact lenses in the US. They already use technology to track orders from entry to picking, shipping and billing for over 300,000 products. Besides speeding up the flow of business, this system scans product at point of shipment and checks to make sure what's in the box is exactly what was ordered. Result: 100% quality, faster shipping, and lower costs. Since this system is expandable, we are now acquiring strong regional companies to build a national powerhouse. This company is also using the Internet to open a new channel to improve service to out customers by giving each of them a personalized website to service their customers.

Another company manufactures picture frames and operates 70 retail stores where customers can buy pre-framed art, as well as have their own artwork or their diploma custom-framed. This company uses technology to transmit custom orders from a point of sale terminal in the store to the factory, so they can begin making the frames without delay, which allows them to serve the customer in a few days instead of weeks. They are also in discussions a company that sells artwork on the Internet about providing all their framing and fulfillment needs which could dramatically increase sales.

These stories all have two things in common; managers with the right mental attitude and the right resources to do the job. To successfully use new technology to change an existing business, managers must be committed to attacking new opportunities, not to defending old ways. And they must be willing to move fast.

These companies will profit from the technology boom, regardless of stock market valuations for the dot.com companies.